The most common question we are asked is “How can I avoid Foreclosure?”. Foreclosure
is the process in which your mortgage or other lien holder obtains a court ordered
termination of a mortgagor’s equitable Right of Redemption. This usually occurs
only after a default by the borrower who has failed to make payments per the terms
of the mortgage or deed of trust. The process starts when you receive a ”Notice
of Default” or N.O.D. . When the foreclosure process is complete, the lender may
take your property and/or put it up for sale and keep the proceeds to pay off any
mortgage and legal costs associated with the foreclosure. This process will negatively
impact your credit score and may disqualify you for a new mortgage for at least
five (5) years.

Some states are non-judicial foreclosure states. This means that a court action
is not required to foreclose on a home. Your loan contains a Deed in Trust that
usually contains a Power of Sale Clause which upon default, allows a Trustee to
foreclose on the property and use the proceeds of the foreclosure to satisfy the
underlying defaulted loan. Some states also have a requirement called the One-Action
Rule. This rule prohibits a lender or servicer from going after you for a Deficiency
Judgment to pay the difference between what you owe and the net proceeds of a foreclosure
sale.

In many states, your lender must file a Notice of Default (N.O.D.) before you are
officially in foreclosure. This is served to you via registered mail and is a public
document that is recorded in the County in which the property is located. An N.O.D.
can be issued as early as 90 days after you default, but may arrive much later due
to backlogs in foreclosures at your bank. The N.O.D. provides you usually 60 days
to cure the default in what is known as the Redemption Period before a sale on the
property can proceed. If the loan delinquency is not cured during this period, a
Notice of Sale may be issued. It is often preceded by people in your yard taking
photos of your property. Further, this notice must be posted on the property, typically
on the front door, as well as a public place such as a newspaper. Many banks enforce
certain restrictions or additional requirements when a loan has been assigned a
sale date.

As such, the earlier you address your delinquency, the more likely we are to receive
a positive outcome that resolves your foreclosure. It is important to remember that
the sooner you contact our law firm, then the sooner we can represent you in achieving
a repayment plan or other workout solution such as a permanent loan modification.

So how can you avoid Foreclosure or get foreclosure help? The most obvious answer
is to stay current on your loan pursuant to the terms of your original mortgage
agreement. If you are experiencing a financial hardship and can provide documentation
evidencing the hardship, and you earn substantial income, CAPITAL LAW CENTER, Robert
W. Carlson & Associates, P.A. can represent your legal interests and renegotiate
the repayment terms of your existing loan. Our experienced Case Managers, paralegals,
processors and Attorneys will help you build a strong case on your behalf. Retaining
our law firm’s services will force your lender to deal directly with the attorney
representing you and your interests.

Here are some examples of qualifying hardships:

Inability to work due to health or medical issues

Excessive Medical bills

Business failure

New lower paying job / Laid off / Loss of income/ reduction in work hours or overtime

Death of a contributing spouse or family member

Mounting bills

Divorce or separation causing a decrease in income

Cannot afford new adjusted mortgage payment or are within 120 days of an ARM reset

CAPITAL LAW CENTER, Robert W. Carlson & Associates, P.A. will contact your lender
with the goal of negotiating (through arbitration) more favorable loan terms such
as a lower payment and interest rate. If you owe more that the home is now worth,
we may be able to get your lender to defer principal, forgive some of the principal
on your loan, including adding missed payments to your principal balance or provide
you with a structured repayment plan for past due balances. Although principle reductions
are rare under current programs, they may be provided if the right circumstance
exist. Loan modifications come in many forms: recapitalizing the arrearage, principal
write-downs or deferrals, repayment plans, interest rate reductions, Step-Rate and
Cap Modifications are all examples of voluntary concessions that can be offered
by your lender once they have contacted our lawyers representing you.

We are often asked by people, why this process of obtaining a loan modification
on their own is so difficult. Many people also ask our law firm why many banks are
continuously losing paperwork or giving them the “run-a-round”. Most people believe
their lender will “lose money on my home if they foreclose”? What most people do
not realize is your loan is not owned by the servicer (Bank of America, Wells Fargo,
J.P. Morgan Chase, HSBC, PNC, One West, etc.) collecting your payments. Your home
loan is typically packaged and owned by a Securitized Trust. These Trusts hire your
lender to service your loan utilizing a Pooling and Servicing Agreement (PSA). The
investor, not your servicer, loses when your home is foreclosed upon. Conversely,
it is often in the Servicer’s best financial interest to keep your loan as delinquent
as possible for as long as possible, as they earn much higher fees to service the
loan, fees they can charge you, and penalties from both you and the investor for
servicing a delinquent loan. The longer the modification process takes, the more
money your bank/servicer earns in these fees. Many servicers actually push for a
foreclosure as they may stand to make an additional $5,000 to $7,000 in fees foreclosing
on your home. It is the Investor and the borrower who typically incur the losses.

The PSA requires your bank do what is in the best financial interests of the investor.
Your servicer will calculate the Net Present Value (NPV) to determine this. NPV
determines the cash flow value of your loan in a modified state over a period of
time, versus the cash flow in a foreclosure scenario. The only way to know your
NPV is by utilizing a REST Report. The REST Report utilizes an enterprise level
software solution developed for the banks & servicers to perform “loan disposition
analysis” of your financial situation, and is not typically available to consumers.
We use a REST Report on every qualifying HAMP eligible loan to prove to your Servicer
and Investor that it is in their best financial interest to modify the loan instead
of foreclose on your home and incurring possible additional legal fees from fighting
against our law firm.

Our arbitration and mitigation services may help you save your home by preparing
a financial plan to your lender that you can afford. We will analyze your financial
situation and calculate the various debt-to-income ratios required to determine
your hardship and capacity to pay. This is a full document, full disclosure process.
As such, our clients must provide all documents requested to CAPITAL LAW CENTER,
Robert W. Carlson & Associates, P.A. so that we may prepare them for settlement
proposal in a way that will optimize your chance of a positive outcome. All of the
facts surrounding your case will be presented by your attorney. Loss Mitigation
Departments at lenders are typically understaffed and trained to “put off” the consumer
and not address your issues. Our experienced attorneys will fight for your rights
and will not allow your lender to put us on the “back burner”. Our years of experience
negotiating resolutions in thousands of similar situations help us push your lender
to address the merits of your case in our effort to secure you a lower payment.
Most modifications last for 5-7 years, and will typically lower your rate to current
market level as a fixed rate for the remainder of your loan term, thus eliminating
the adjustable feature of your loan so you can remove the uncertainty of an adjustable
rate loan. Additionally, we will seek to recapitalize any past due payments, as
well as get fees and penalties waived depending on the program you qualify for.
In some cases, your financial situation may not merit a loss mitigation process.
In such situation, we may recommend alternatives such as a short sale, litigation,
or bankruptcy protection.

Call us today at 1-866-533-2533 for a FREE, no-obligation consultation to see if
we believe you qualify for a home loan modification to avoid foreclosure. Help us,
help you!

This Detailed Explanation of the Flaws in Lenders and Banks Loan Modification Programs

Diane E. Thompson's testimony before the US Senate Committee on Banking, Housing,
& Urban Affairs regarding the barriers encountered by homeowners when attempting
to deal with banks for loan modifications and foreclosure assistance.

Disclaimer:
The information contained herein is provided for general information purposes only and is not intended to convey a legal option nor legal advice for any particular case or situation. Nothing in this website shall create an attorney-client relationship. Nothing sent to this office via e-mail shall constitute an attorney-client relationship. Nothing contained in this website shall be construed to be a guarantee or prediction of result.